Employment Law

The United States Congress enacted the first federal employment laws in 1888. Now, more than 180 federal laws mandate how employers must treat their employees and every state has its own employment laws. While every state in the union has its own employment laws, California has more employee friendly laws than any other state.

Over the past three years, Levy Phillips APC has represented individual employees in actions against their employers who have failed to provide proper wages, rest breaks and meal periods required by California law, and promised health benefits. We are proud to have obtained over a million dollars ($1,000,000) in settlements for our clients in these cases.

Federal and State employment laws regulate every phase of the employment relationship from hiring to termination and everything in between. Employees cannot keep up with all of these regulations and laws and many employers, both large and small, fall short of compliance. If you feel you are being mistreated at work, in any respect, including harassment of any kind, you need Levy Phillips APC to lend our expertise.

May 21, 2019

DOL not unexpectedly issues opinion letter holding service providers working for a virtual marketplace company are not employees, but rather independent contractors.

The DOL has concluded that a virtual marketplace company (VMC) is an online and/or smartphone-based referral service that connects service providers to consumers for a variety of services such as transportation, delivery, shopping, moving, cleaning, plumbing, etc. One such VMC asked for an opinion on whether their service providers are employees or independent contractors.

The Labor Department considers 6 factors to determine if a worker is an employee: employer’s control; permanency of relationship; employer’s investment in facilities, equipment, or helpers on behalf of the workers; the amount of skills required; the worker’s opportunity for profit and loss; and the integration of a worker’s services into the business.

Based on the facts provided, it was determined that this VMC is a referral service, not an employer, and that the workers are independent contractors with economic independence. The providers are paid on a per-job basis, can set and modify their own prices, and they may accept, reject, or ignore opportunities through the platform. They can work for competitors at the same time and are only terminated if they commit a material breach of the agreement.

VMCs are a small but growing segment of the working population and their de facto workers will continue to not be covered by the protections offered in the Fair Labor Standards Act such as overtime, etc.

JANUS: HOW WE GOT HERE

AND WHERE WE GO FROM HERE?

HOW WE GOT HERE

In June 2018, the Supreme Court dealt a huge blow to public sector unions and the labor movement in general, ruling in Janus v. AFSCME that public employees do not have to pay fees to unions to cover the costs of collective bargaining. The court split along partisan lines when it overruled 41 years of precedent by deciding that public sector employees cannot be required to pay fees to their union because requiring them to do so violates their First Amendment rights.

With the decision, public sector employees around the nation will no longer have to pay fees or dues to their unions, even if those unions collectively bargain on behalf of those employees—likely impacting union membership and revenues nationwide. Until now, 22 states had in place a so-called “fair share” provision, which required people represented by unions, who did not choose to be members of these unions, to pay fees to cover the cost of the unions’ collective bargaining activities. By contrast, 28 states were so-called “right-to-work” states and barred employers from including “fair share” requirements in employment contracts.

The Janus decision immediately makes null the fair-share provisions by overturning a 1977 case, Abood v. Detroit Board of Education. In that case, public school teachers in Detroit who opposed public sector collective bargaining argued that they should not have to pay fees to the union. The Abood decision prohibited public sector unions from using union fair-share fees for political causes like lobbying, but found that unions could use those fees to cover the cost of collective bargaining, which produced economic gains for union members. Without fair-share fees, economists argued, then and now, union members have an incentive to become “free-riders,” benefiting from collective bargaining without paying for it.

By way of background, until the mid-twentieth (20th) century, the vast majority of public sector employees had no collective bargaining rights or even employment rights. By the mid-1960s the nationwide trend was to grant public employees similar rights of self-organization and to collectively bargain as private sector employees have under the National Labor Relations Act. In California, this trend resulted in passage of numerous public sector labor relations statutes: the Meyers-Milias-Brown Act (governing local/county public employers), the Dills Act (covering State of California employees; also known as the “State Employee and Employer Relations Act”), the Educational Employees Relations Act (covering K-12 and community college employees/teachers/professors), the Higher Educational Employees Relations Act (covering University of California and California State University employees), etc. However, there are still a handful of states that completely deny collective bargaining and/or self-organizational rights to their public employees: Janus has no impact on these states.

Conservative writers start arguing – in the mid-2000s – that the mere act of a union sitting across the bargaining table from a public employer was an exercise of “speech” under the First Amendment. The rationale for this argument was that bargaining was an act of “petitioning” the government under the First Amendment and, therefore, was “speech” which public sector employees could not constitutionally be forced to support. This strained argument began to receive approval from conservative judges: In particular, one conservative darling, US Supreme Court Justice Samuel Alito, pushed this legal position hook, line and sinker. Thus, in Harris v. Quinn (2014), Alito opened the door to killing fair share requirements and signaled that, with the right case – which would become Janus – he would vote to overrule Abood.

Janus originated in California and is actually an attack against all of California’s public sector labor relations statutes which allow for fair share requirements. Janus expressly overrules Abood and concludes that any such compulsory requirement for public sector employees is unconstitutional and in violation of the First Amendment.

Janus completely stops and renders illegal the payment of a fair share agency fee from a non-member to her/his exclusive bargaining representative in the absence of a written authorization voluntarily signed by the employee which allows for a dues/agency fee deduction. It also states that it does not render illegal any “contract” between the union and an employee (whether a member or not) which requires that employee to pay, through payroll deductions, a representation fee to the union: these documents are known as “Dues Deduction and Authorization Cards”. These cards will become very important for all public sector unions!

The effect of Janus is: (1) all public employers across the United States must immediately cease and desist from deducting any agency fee/representation fee from a non-member’s paycheck and (2) the employer may still deduct and forward dues/agency fees to the union only where the employee is signed to a valid and enforceable Dues Deduction and Authorization Card.

WHERE WE GO FROM HERE?

Janus has clearly changed the entire landscape of public employee representation. In California, the first and most immediate impact is that every public sector labor union must request bargaining with their public employer counterparts. This bargaining must be directed at modifying any Agency Shop language in the applicable contract and establishing procedures going forward with regard to the payment/deduction of full membership dues and, if applicable, representation fees.

California law, at present, clearly provides for the full enforceability of a valid Dues Deduction and Authorization Card: so long as an employee has voluntarily signed a valid Dues Deduction and Authorization Card, the employer cannot unilaterally stop deducting dues/agency fees and sending those monies to the union; and, California law also holds that a Dues Deduction and Authorization Card may only be terminated in exact accordance with the termination language set forth on the Card itself.

While there is State legislation under consideration after Janus, the really controversial issue arises from the doctrine of “exclusivity of representation”. Essentially, unions were granted the legal right to exclusively represent an entire bargaining unit upon a showing of majority support (fifty percent plus one), but that right was accompanied by the legal obligation to fairly and equally represent everyone in the unit as well. Should unions react to Janus by attempting to charge free-loaders for the representation services they desire, what will be the impact on the right of exclusive representation? Will non-supportive members of the bargaining unit be free to choose another union or other group or person to represent them? These are just a few of the difficult questions that arise and, as the expression goes, look for “mission creep” as conservatives attempt to find ways to apply Janus to the private sector as well.

EMPLOYERS CANNOT ALWAYS MAKE EMPLOYEES USE PAID TIME OFF WHILE ON FMLA/CFRA

March 12, 2019

Since the FMLA came into existence, employers have frequently required employees on FMLA to utilize sick leave, vacation and other forms of PTO (“paid time off”) concurrently with FMLA.

When this issue comes up, and it continues to do so, the question to be answered is whether the FMLA leave is, in fact, unpaid. FMLA regulations provide that if during FMLA leave an employee also receives benefits, in any amount, from a disability plan or workers’ compensation, the FMLA leave is not unpaid. Because the FMLA’s general rule permitting employers to require employee substitution of paid leave only applies to unpaid FMLA, during periods of FMLA when any income replacement is received, employers cannot require employees to substitute paid leave. This exception to the FMLA general rule applies regardless of the amount of income replacement received. The same principles apply to leave under the California Family Rights Act (CFRA), which is the state law version of the FMLA.

For example, if an employee taking FMLA/CFRA leave is also receiving California State Disability Benefits (“SDI”) that replace a portion of their income, the employer may not require that the employee use PTO to make up for the portion of income not covered by the disability benefits. The employee can, however, be required to use paid leave during a waiting period before disability benefits are received, because the limitation is triggered by the receipt of income replacement benefits.

This issue was at the center of Repa v. Roadway Express, Inc., a 2007 7TH Circuit case. Alice Repa suffered an injury that required surgery and a six-week absence from work. During the leave, Repa received a weekly $300 disability benefit through a private third-party disability plan. While she was on FMLA, her employer required her to use vacation and sick leave. Repa sued seeking to have her sick leave and vacation benefits restored. Repa was awarded summary judgment as the Court held that an employer’s ability to require an employee to substitute paid leave during FMLA is limited if, during FMLA leave, the employee also received disability benefits. While Repa, during her FMLA leave, could have elected to substitute paid leave at the same time she was receiving disability benefits, it was unlawful for her employer to require her to do so.

While this limitation is not new, it is commonly overlooked by employers especially where a collective bargaining agreement (“CBA”) or past practice allows for concurrent use of PTO with FMLA/CFRA time, without making the appropriate distinction. It is our position that any such provision in a CBA would have to be interpreted in accordance with federal and state regulations. If your employer is requiring you to use PTO concurrently with FMLA or CFRA and you are also receiving a public or private form of disability benefit as full or partial income replacement, including Workers Comp, you may have a good claim. You have the right to file a complaint with the United States Department of Labor Wage and Hour Division (which enforces the FMLA) and the California Department of Fair Employment and Housing (which enforces CFRA). You also have the right to file a lawsuit in federal or state court. Importantly, if you win the lawsuit, your employer may be required to pay your attorneys’ fees as well as actual damages. If you believe your employer is violating your rights under the FMLA or CFRA, you should contact us for assistance.

FMLA LEAVE AND NO-FAULT ATTENDANCE GUIDANCE

The Department of Labor recently issued guidance regarding the intersection between FMLA leave and “no-fault” attendance policies. Here’s what you should know.

As many of you know, under no-fault attendance policies, employees generally accumulate “points” for each absence regardless of the reason for the absence. Employees are subject to discipline once they reach a certain number of points. However, certain types of absences cannot be counted as points. FMLA leave is one such example. That has been the rule for a very long time. The new DOL guidance confirms that this is still the rule. That’s the good news.

Now, for the bad news. Most no-fault attendance policies state that points will be removed from the employee’s record after a certain period of time – for example, one year. But what happens when an employee takes FMLA leave? Is the employer required to count time spent on FMLA towards the expiration date for attendance points? Unfortunately, according to the DOL, the answer is “no”. An employer can require only working time count toward the expiration date for attendance points.

For instance, if an employee gets an attendance point on January 1, 2018, that point would normally expire on January 1, 2019 under a policy stating that points expire after one year. However, if the employee takes FMLA during 2018, the employer can “freeze” the count-down clock during the period of the FMLA. If the FMLA was for thirty (30) days, the expiration period would be extended by an additional thirty (30) days.

There is, however, one exception to this rule. The employer cannot discriminate based on the type of leave that you use. It must treat FMLA leave the same as other similar types of leave. For example, if the employer has a paid sick leave policy that counts time spent on paid leave toward the expiration date for attendance points, it must also count unpaid FMLA time toward the expiration date. Otherwise, the employer would be subject to a claim for discrimination.

If you or your co-workers believe you have been discriminated against or have any questions about FMLA and no-fault attendance policies, please contact our office to discuss your rights.